IBM has said it is an industry that still predominantly works in traditional siloed environments and fails to integrate or analyse the ‘big data’ it produces.
A survey from the computer firm shows just one in six organisations integrated their customer data into a single database, while over a third did not integrate their customer data at all.
Based on interviews with 50 senior IT decision makers at UK insurance companies – also found that 64% of respondents had more than five separate database systems and almost a fifth only use basic spreadsheets to manage customer information.
Key statistics from the survey include:
Customer data integration
• Just 16% of companies integrate customer data into a single database
• 38% of companies do not integrate their data at all
• 88% of companies expressed concern at how a lack of customer data integration could affect sales
• 38% of companies had 6-10 databases
• 26% of companies had over 11 databases
Customer data analysis
• Only 50% of companies used Business Intelligence software to analyse customer data
• 18% of companies used only spreadsheets to analyse customer data
Winning and retaining customers
• 46% of companies had got worse at winning and/or retaining customers in the last five years
• Only 18% of companies had improved in both areas in the last five years
Danny Lee, World Wide Insurance Industry Lead at IBM, said: “Insurance companies are constantly being given detailed information about customers and prospects in the form of quote requests, renewals and claims, but are all too often failing to extract the full value from this data.
“Companies can no longer afford to squander the potential intelligence being handed over to them by relying on outmoded processes and technologies.”
By cross-referencing the survey, it was found that those companies using basic databases and spreadsheets were far more likely to feel they were performing poorly at winning or retaining customers (57%) compared with those using business analytics (8%).
Companies already using analytical tools were also able to collect 76% of the data from customer transactions, compared to just 57% using basic databases and spreadsheets.
IBM added that the IT departments of insurance companies are still prioritising meeting regulatory requirements and keeping data secure over using technology to build better customer relationships and grow the business.